Hawk Exceeding 2010 Expectations
September 22 2010 - 7:58AM
Marketwired
Hawk Corporation (NYSE Amex: HWK) announced today that it is
raising its guidance for its full year 2010 net sales and operating
income from its previously revised guidance issued on June 23,
2010. The Company is increasing its guidance for 2010 full year net
sales to a range of between $241.0 million and $246.0 million from
its previous guidance range of between $225.0 million and $232.0
million, as a result of continued strength in demand primarily in
its construction and mining and heavy truck markets. This new
guidance range represents an increase of between 39.8% and 42.7%
over 2009 net sales of $172.4 million.
Based on the impact that these improved sales volumes will have
on its financial results, Hawk is also increasing guidance for its
2010 full year operating income to a range of between $36.0 million
and $39.0 million from its previous guidance range of between $32.0
million and $35.0 million. This new guidance range represents an
increase of between 115.6% and 133.5% over 2009 operating income of
$16.7 million.
Ronald E. Weinberg, Hawk's Chairman and CEO, said, "We continue
to see the benefits of the global economic recovery and the focus
on infrastructure improvements which play directly into our
strength in the construction and mining end markets. The increased
demand for the equipment that consumes our friction material is
real and sustainable for the foreseeable future. In large part, the
demand is being driven by the realization of sales from new
business awards won in prior years and sales to developing
countries in the global marketplace including China, India and
Russia. We have strategically positioned Hawk to service these
expanding markets, and our financial results reflect the value that
we bring to the equation."
The Company is reaffirming its previous guidance for
depreciation and amortization of approximately $8.0 million, and
its effective worldwide tax rate of approximately 35.0%. Hawk is
revising its expectation for capital spending in 2010 to a new
range of between $6.0 million and $8.0 million from its previous
guidance of between $7.0 million and $9.0 million.
As previously announced, Hawk's Board of Directors has commenced
a process to explore and consider possible strategic alternatives,
including a possible sale of the Company. Included in the operating
income guidance range is an estimate for expenses that have been,
or are expected to be, incurred in connection with the exploration
of strategic alternatives regardless of whether or not a
transaction occurs. Hawk expects these expenses, which were not
included in its previous guidance, will be approximately $1.3
million in 2010.
Management has not scheduled a conference call in conjunction
with this revised guidance. The Company's third quarter ends
shortly and additional information will be available when the
Company reports its financial results in November. In addition and
as previously disclosed, Hawk does not intend to disclose
developments regarding its exploration of strategic alternatives
unless and until its Board of Directors approves a specific
transaction or otherwise concludes the review of strategic
alternatives.
The Company Hawk Corporation is a leading
supplier of friction materials for brakes, clutches and
transmissions used in airplanes, trucks, construction and mining
equipment, farm equipment, recreational and performance automotive
vehicles. The Company also operates a fuel cell components
business. Headquartered in Cleveland, Ohio, Hawk has approximately
1,400 employees at 12 manufacturing, research and development,
sourcing, sales and administrative sites in 7 countries.
Forward-Looking Statements This press
release includes forward-looking statements concerning sales,
operating earnings, depreciation and amortization expense, capital
expenditures and effective tax rates. These forward-looking
statements are based upon management's expectations and beliefs
concerning future events. Forward-looking statements are
necessarily subject to risks, uncertainties and other factors, many
of which are outside the control of the Company and which could
cause actual results to differ materially from such statements.
These risks and uncertainties include, but are not limited to the
Company's ability to execute its business plan to meet its sales,
operating income, cash flow and capital expenditure guidance, the
Company's ability to enter into or consummate a transaction as a
result of the exploration and consideration of possible strategic
alternatives and the Company's ability to enhance stockholder value
through this process. Other risks are detailed in Hawk's filings
with the Securities and Exchange Commission, including its annual
report on Form 10-K for the year ended December 31, 2009, its
quarterly reports on Form 10-Q, and other periodic filings.
Actual results and events may differ significantly from those
projected in the forward-looking statements. Any forward-looking
statement speaks only as of the date on which such statement is
made, and the Company undertakes no obligation to update any
forward-looking statement, whether as a result of new information,
future events or otherwise.
Contact Information Joseph J. Levanduski Senior Vice
President - Chief Financial Officer (216) 861-3553 Thomas A.
Gilbride Vice President - Finance (216) 861-3553 Hawk Corporation
is online at: www.hawkcorp.com
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